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Begun to Improve Its Information on Foreign Establishments, but More
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Report to the Committee on Oversight and Government Reform, House of
Representatives:
United States Government Accountability Office:
GAO:
September 2010:
Drug Safety:
FDA Has Conducted More Foreign Inspections and Begun to Improve Its
Information on Foreign Establishments, but More Progress Is Needed:
GAO-10-961:
GAO Highlights:
Highlights of GAO-10-961, a report to the Committee on Oversight and
Government Reform, House of Representatives.
Why GAO Did This Study:
Globalization has placed increasing demands on the Food and Drug
Administration (FDA), an agency within the Department of Health and
Human Services (HHS), in ensuring the safety and effectiveness of
drugs marketed in the United States. Drugs manufactured in more than
100 countries were offered for entry into the United States in fiscal
year 2009. FDA inspects drug manufacturing establishments in order to
ensure that the safety and quality of drugs are not jeopardized by
poor manufacturing practices.
In 1998 GAO identified weaknesses in FDA’s foreign drug inspection
program. In 2008 GAO found, among other things, that from fiscal years
2002 through 2007, FDA inspected relatively few foreign establishments
each year. GAO also determined that, because of inaccurate information
in its databases, FDA did not know how many foreign drug
establishments were subject to inspection.
In 2008 GAO recommended that FDA increase inspections of foreign drug
establishments and improve information it receives to manage the
foreign drug inspection program. This report examines FDA’s progress
since 2008 in (1) conducting more foreign drug inspections, and (2)
improving its information on foreign drug establishments. GAO analyzed
information from FDA databases, reviewed documents related to FDA’s
efforts to both improve these databases and supplement its existing
information on foreign drug establishments, examined staffing and
funding information, and interviewed FDA officials.
What GAO Found:
FDA increased the number of foreign drug inspections it conducted from
fiscal year 2007 to 2009, but still conducts relatively fewer foreign
drug inspections each year than it conducts domestically. In fiscal
year 2009, FDA conducted 424 foreign inspections, compared to 333 and
324 inspections conducted in fiscal years 2007 and 2008, respectively.
Using a list FDA developed to prioritize foreign establishments for
inspection, GAO estimated that FDA inspected 11 percent of foreign
establishments on this list in fiscal year 2009. At this rate, GAO
estimated it would take FDA about 9 years to inspect all
establishments on this list once. In contrast, in that same year, FDA
conducted 1,015 domestic inspections, inspecting approximately 40
percent of domestic establishments. GAO estimated that at this rate
FDA inspects domestic establishments approximately once every 2.5
years. Further, FDA’s approach in selecting establishments for
inspection is inconsistent with GAO’s 2008 recommendation that FDA
inspect, at a comparable frequency, those establishments that are
identified as having the greatest public health risk potential if they
experience a manufacturing defect, regardless of whether they are a
foreign or domestic establishment. Instead, its foreign inspections
continue to be driven by the establishments listed on an application
for a new drug, instead of those already producing drugs for the U.S.
market.
FDA is taking steps to improve the information it receives from the
drug establishment registration and import databases the agency uses
to manage its foreign drug inspection program. For example, FDA is
working to obtain more accurate information for its database that
contains information about foreign establishments registered to market
their drugs in the United States. In addition, FDA has an initiative
underway to eliminate duplicate information from its database
containing information about foreign establishments whose drugs are
offered for import into the United States. However, these efforts are
in the early stages. In addition, FDA is exploring other options for
obtaining better information about foreign drug establishments, such
as by collaborating with foreign regulatory authorities to exchange
information about planned inspections and the results of completed
inspections.
In 1998, and again in 2008, GAO reported that FDA needed to conduct
more inspections of foreign establishments and that it was vital that
the agency strengthen the data it uses to manage its foreign drug
inspection program. FDA has begun to respond to GAO’s recommendations;
however, it has not yet fully addressed these weaknesses at a time
when the volume of imported drugs and the number of foreign
establishments producing these drugs have been increasing. Given the
long-standing nature of these challenges and the nation’s reliance on
drugs manufactured overseas, it is urgent that FDA implement GAO’s
prior recommendations to better protect public health. HHS reviewed a
draft of this report and agreed that more progress is needed in order
to meet the challenge of safeguarding the nation’s drug supply in
today’s global marketplace.
View [hyperlink, http://www.gao.gov/products/GAO-10-961] or key
components. For more information, contact Marcia Crosse at (202) 512-
7114 or crossem@gao.gov.
[End of section]
Contents:
Letter:
Background:
FDA Conducted More Foreign Inspections in Fiscal Year 2009, but
Continued to Conduct Relatively Fewer Foreign than Domestic
Inspections:
FDA Is Taking Steps to Improve Its Information on Foreign Drug
Establishments, but These Efforts Are in the Early Stages:
Concluding Observations:
Agency Comments and Our Evaluation:
Appendix I: Comments from the Department of Health and Human Services:
Appendix II: GAO Contact and Staff Acknowledgments:
Related GAO Products:
Tables:
Table 1: Total Number of FDA Inspections of Foreign Establishments,
Fiscal Year 2007 through Fiscal Year 2009:
Table 2: Number of Establishments in FDA's Inventory That May Never
Have Been Inspected by FDA and the Total Estimated Number of
Establishments in Its Inventory, by Country, Fiscal Year 2009:
Table 3: Number of Inspections Conducted by Inspection Type for the
Most Frequently Inspected Countries in Fiscal Year 2009:
Figure:
Figure 1: FDA Foreign and Domestic Drug Establishment Inspections by
Type of Inspection, Fiscal Year 2009:
Abbreviations:
API: active pharmaceutical ingredient:
CBP: Customs and Border Protection:
CDER: Center for Drug Evaluation and Research:
DRLS: Drug Registration and Listing System:
D-U-N-S®: Data Universal Numbering System:
FACTS: Field Accomplishments and Compliance Tracking System:
FDA: Food and Drug Administration:
FTE: full-time equivalent:
GMP: good manufacturing practice regulations:
HHS: Department of Health and Human Services:
OASIS: Operational and Administrative System for Import Support:
ORA: Office of Regulatory Affairs:
OT: Cover-the-counter:
[End of section]
United States Government Accountability Office:
Washington, DC 20548:
September 30, 2010:
The Honorable Edolphus Towns:
Chairman:
The Honorable Darrell E. Issa:
Ranking Member:
Committee on Oversight and Government Reform:
House of Representatives:
Globalization has placed increasing demands on the Food and Drug
Administration (FDA), an agency within the Department of Health and
Human Services (HHS), in carrying out its role of ensuring the safety
and effectiveness of drugs marketed in the United States.[Footnote 1]
The United States has come to depend on drug products and drug
ingredients manufactured in foreign countries, and FDA is responsible
for the oversight of drugs marketed in the United States, regardless
of whether they are manufactured in foreign or domestic
establishments.[Footnote 2] In March 2010, an FDA official testified
that while Americans once used drugs that were mostly manufactured
domestically, this is no longer the case. The volume of imported
drugs, the complexity of the drug supply chain, and the number of
foreign establishments producing these drugs have all been increasing,
making oversight significantly more difficult.[Footnote 3] According
to FDA import data, drugs manufactured in more than 100 countries were
offered for entry into the United States in fiscal year 2009. To
assure that the safety and quality of drugs are not jeopardized by
poor manufacturing practices, FDA relies on establishment inspections
to determine compliance with current good manufacturing practice
regulations (GMP).[Footnote 4]
Concerns with FDA's foreign drug inspection program have been long-
standing. More than 10 years ago, in 1998, we reported on weaknesses
in FDA's foreign drug inspection program.[Footnote 5] Among other
things, we noted that FDA had significant problems managing its
foreign inspection data. We also found that FDA infrequently inspected
foreign establishments to ensure the continued quality of drugs
already on the market. In that same year, FDA expressed concern that,
despite recent increases, its inspections of foreign drug
establishments could not keep pace with the rapid growth of imported
products.[Footnote 6] Our 1998 report also included information from
two internal FDA reviews that indicated the agency was aware of
problems with its inspection data and concerned with the number of
foreign establishment inspections it was conducting as early as 1988.
At the time our 1998 report was issued, the agency was planning to
implement a new data system to establish a comprehensive inventory of
foreign establishments shipping drug products to the United States.
However, we recommended that, in addition, FDA conduct more foreign
inspections.
In September 2008, we again reported on weaknesses in FDA's foreign
drug inspection program.[Footnote 7] Among other things, we determined
that, because of inaccurate information in FDA's databases, the agency
did not know how many foreign drug establishments were subject to
inspection. We also found that, from fiscal years 2002 through 2007,
FDA inspected relatively few foreign establishments each year. Due in
part to the concerns raised in our September 2008 report, in January
2009, we added FDA's oversight of medical products--drugs, biologics,
[Footnote 8] and medical devices[Footnote 9]--to our High-Risk Series,
citing FDA's ability to ensure the quality of medical products
manufactured overseas as an area of particular concern.[Footnote 10]
Our subsequent reports have reinforced these designations of FDA as an
agency in need of broad-based transformation by identifying additional
concerns with FDA's ability to manage its growing
responsibilities[Footnote 11] and plans for modernizing the agency's
information technology capabilities.[Footnote 12]
Given continued questions about FDA's oversight of medical products,
you asked for an update on the status of FDA's foreign drug inspection
program. This report examines FDA's progress since our September 2008
report in (1) conducting more foreign drug inspections, and (2)
improving its information on foreign drug establishments.
To determine the extent to which FDA has made progress in conducting
more inspections of foreign drug establishments, we obtained
information from FDA's Field Accomplishments and Compliance Tracking
System (FACTS) and analyzed data on foreign and domestic drug
manufacturing establishment inspections conducted from fiscal years
2007 to 2009.[Footnote 13] To assess the reliability of these data we
reviewed related documentation, interviewed knowledgeable agency
officials, performed electronic data testing, and compared inspection
counts to published data. We found counts of inspections sufficiently
reliable for the purposes of our report. We also examined methods used
by FDA to select establishments for inspection. We obtained data FDA
used to prioritize foreign and domestic establishments for inspection
for fiscal years 2007 to 2009. To assess the reliability of these data
we reviewed related documentation, interviewed knowledgeable agency
officials, and performed electronic data testing. We found these data
sufficiently reliable for the purposes of our report. Finally, we
reviewed staffing and funding information for the foreign drug
inspection program. To assess the reliability of FDA funding data, we
reviewed related documentation, interviewed knowledgeable officials,
and examined the data for consistency. We found these data
sufficiently reliable for the purposes of our report.
To examine FDA's efforts to improve its information on foreign drug
establishments, we reviewed FDA's initiatives for improving the
accuracy of the agency's data on foreign establishments contained in
its registration and import databases,[Footnote 14] which are both
used to manage the foreign drug inspection program. We obtained data
from FDA's Drug Registration and Listing System (DRLS) on the number
of establishments registered to market their drugs in the United
States. In addition, we interviewed representatives from FDA's Office
of Critical Path Programs, which is responsible for managing aspects
of the annual registration of drug establishments, and from FDA's
Office of Information Management. We also obtained data from FDA's
Operational and Administrative System for Import Support (OASIS) on
the number of establishments that have manufactured drugs that were
shipped to the United States. To assess the reliability of the data
from both databases we reviewed related documentation, interviewed
knowledgeable agency officials, and compared the data to published
information from the same databases. Through this review, we
identified inaccuracies with some aspects of FDA's registration and
import databases. We found these data sufficiently reliable for
illustrating the variability in information that FDA's databases
provide to agency officials on the number of foreign drug
establishments marketing drugs in the United States. Finally, to
further examine FDA's efforts to improve its information on foreign
drug establishments, we reviewed documents related to the agency's
efforts to augment its existing information on foreign drug
establishments, such as information obtained from foreign regulatory
authorities.
To address both of our objectives, we interviewed officials from FDA,
including its Center for Drug Evaluation and Research (CDER) and the
Office of Regulatory Affairs (ORA), which each have responsibilities
for managing the foreign drug inspection program. Our work focuses on
human drugs regulated by CDER and not on biologics,[Footnote 15]
medical devices, veterinary medicines, or other items or products for
which FDA conducts inspections.[Footnote 16] Further, our work focuses
on activities related specifically to the foreign drug inspection
program. As part of its oversight of imported drugs, FDA undertakes
other activities, such as providing capacity building to foreign
regulatory authorities and working toward international harmonization
of regulatory requirements, which are beyond the scope of our
review.[Footnote 17] Our work also excludes FDA's efforts to screen
imported drugs that enter the United States illegally.[Footnote 18]
We conducted this performance audit from November 2009 to September
2010, in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives.
Background:
As part of its efforts to ensure the safety and quality of imported
drugs, FDA may conduct inspections of foreign establishments
manufacturing drug products and active pharmaceutical ingredients
(API) that are imported into the United States.[Footnote 19] The
purpose of these inspections is to ensure that foreign establishments
meet the same requirements as domestic establishments to ensure the
quality, purity, potency, safety, and efficacy of drugs marketed in
the United States.
Requirements governing FDA's inspection of foreign and domestic
establishments differ. Specifically, FDA is required to inspect every
2 years those domestic establishments that manufacture drugs in the
United States, but there is no comparable requirement for inspecting
foreign establishments that market their drugs in the United States.
However, drugs manufactured by foreign establishments that are offered
for import may be refused entry to the United States if FDA
determines--through the inspection of an establishment, a physical
examination of drugs offered for import, or otherwise--that there is
sufficient evidence of a violation of applicable laws or regulations.
[Footnote 20]
Within FDA, CDER establishes standards for the safety, quality, and
effectiveness of and manufacturing processes for prescription and over-
the-counter (OTC) drugs. ORA's activities are intended to assure that
regulated establishments comply with laws and regulations. ORA
supports CDER by, among other things, inspecting these establishments,
conducting sample analysis on regulated products, and reviewing
imported products offered for entry into the United States. CDER
requests that ORA inspect both foreign and domestic establishments to
ensure that drugs are produced in conformance with federal statutes
and regulations, including current GMPs. ORA investigators and, as
needed, laboratory analysts,[Footnote 21] conduct two primary types of
drug manufacturing establishment inspections, preapproval inspections
and GMP inspections:
* Preapproval inspections of domestic and foreign establishments may
be conducted before FDA will approve a new drug to be marketed in the
United States. These inspections occur following FDA's receipt of a
new drug application or an abbreviated new drug application[Footnote
22] and focus on the manufacture of a specific drug.[Footnote 23]
Preapproval inspections are designed to verify the accuracy and
authenticity of the data contained in these applications to determine
that the establishment is following commitments made in the
application. Preapproval inspections also assess whether the
establishment can manufacture the product in the application in
conformance with GMPs. FDA's decision to inspect a particular
establishment listed on the application is based on multiple factors,
including the compliance history of the establishment--that is, the
results of previous inspections, product recalls, and other compliance
information--and the attributes of the product being proposed for
manufacture.[Footnote 24]
* GMP inspections are conducted at establishments manufacturing drugs
already marketed in the United States to determine ongoing compliance
with laws and regulations. These inspections focus on an
establishment's systemwide controls for ensuring that its
manufacturing processes produce drugs that are of high quality.
Systems examined during these inspections include those related to
materials, quality control, production, facilities and equipment,
packaging and labeling, and laboratory controls. These systems may be
involved in the manufacture of multiple drugs. For surveillance
purposes, some establishments may be selected for GMP inspections
through CDER's risk-based selection process, which draws on a variety
of factors to identify those establishments that FDA considers to be a
priority for inspection. Establishments may also be selected for GMP
surveillance inspections for other reasons, such as FDA's focus on a
particular product or geographic region. Establishments may also be
the subject of a GMP inspection conducted for cause if FDA receives
information indicating problems in the manufacture of marketed drugs
or when FDA follows up on establishments that were not in compliance
with GMPs during previous inspections.[Footnote 25]
While FDA may conduct a preapproval-only inspection or a GMP-only
inspection, FDA may also conduct an inspection that combines both
preapproval and GMP components in a single visit to an establishment.
As the results of a GMP inspection can often be generalized to all
drugs manufactured in a similar manner at a particular establishment,
FDA can use the results of the combined inspection to make decisions
in the future if the establishment is listed on another application.
Therefore, when an establishment has already been selected to receive
a preapproval inspection, FDA may also conduct a GMP inspection during
the same visit.[Footnote 26]
FDA uses multiple databases to select foreign establishments for GMP
surveillance inspections, including the following:
* DRLS contains information on foreign and domestic drug
establishments that have registered with FDA to market their drugs in
the United States. This information includes company name and address
and the drugs they manufacture for commercial distribution in the
United States, as reported by the establishment.
* FACTS contains information on foreign and domestic establishments
inspected by ORA, the type of inspection conducted, and the outcome of
those inspections. ORA investigators and laboratory analysts enter
information into FACTS following completion of an inspection.
* OASIS contains information on drugs offered for entry into the
United States, including information on the establishment that
manufactured the drug. The information in OASIS is automatically
generated from data managed by Customs and Border Protection (CBP),
within the Department of Homeland Security. The data are originally
entered by customs brokers based on the information available from the
importer.[Footnote 27] CBP specifies an algorithm by which customs
brokers generate a manufacturer identification number from information
about an establishment's name and address.
In September 2008 we reported that FDA did not maintain a list of
foreign drug establishments subject to inspection, instead relying on
information from DRLS and OASIS to help select establishments for
inspection. However, we noted that these databases contained incorrect
information about foreign establishments and did not contain an
accurate count of foreign establishments manufacturing drugs for the
U.S. market. For example, some establishments included in DRLS did not
actually manufacture drugs for the U.S. market.[Footnote 28] As a
result, FDA did not know how many foreign establishments were subject
to inspection.
To select foreign establishments for GMP surveillance inspections,
CDER continues to rely on information from multiple databases,
including those with which we previously identified inaccuracies. CDER
uses data from DRLS and FACTS to annually compile an inventory of
foreign establishments that may be subject to inspection; it does not
maintain a list of such establishments. While DRLS provides
information on all registered establishments, FACTS provides
information about additional establishments that may not appear in
DRLS.[Footnote 29] To prioritize establishments for GMP surveillance
inspections, CDER applies a risk-based model to this inventory of
establishments each year to identify those establishments that, based
on the characteristics of the establishments and of the drugs being
manufactured, pose the greatest public health risk potential should
they experience a manufacturing defect. Establishments are further
prioritized based on whether, according to OASIS data, they are
actively importing their products to the United States. Establishments
that have not shipped a product to the United States in the previous 3
years are not scheduled for inspection. Through this process, CDER
annually prepares a list of a selected set of foreign establishments
from this inventory that it forwards to ORA,[Footnote 30] requesting
that ORA staff conduct GMP surveillance inspections at a certain
number of establishments on this prioritized list. In order to use
resources efficiently, officials told us that ORA staff may select
establishments for inspection from CDER's prioritized list based on
geographic proximity to other planned inspection trips.
In September 2008 we also reported that FDA inspected fewer foreign
drug establishments than it inspected domestically. We noted that
while the majority of domestic establishments inspected were selected
to examine the manufacture of drugs already marketed in the United
States, FDA generally only selected foreign establishments for
inspection if they were named in an application for new drug approval.
As a result of our findings, we made a number of recommendations to
the FDA Commissioner, including that FDA should improve the accuracy
of the data it uses to manage its foreign inspection program. We also
recommended that FDA increase the number of foreign inspections so
that foreign establishments are inspected at a frequency comparable to
domestic establishments with similar characteristics. In response, FDA
described plans to improve the databases it uses to manage the foreign
drug inspection program and agreed that it should conduct more
inspections of foreign drug establishments.
FDA Conducted More Foreign Inspections in Fiscal Year 2009, but
Continued to Conduct Relatively Fewer Foreign than Domestic
Inspections:
FDA conducted more foreign drug inspections in fiscal year 2009 than
in prior fiscal years through staffing changes and dedicating
additional resources to conducting foreign inspections. However, FDA
continued to conduct relatively fewer foreign drug establishment
inspections than domestic inspections. FDA's selection of foreign
establishments for inspection was mainly for preapproval purposes,
while domestic establishments were mainly inspected to examine the
manufacturing of drugs already marketed in the United States.
FDA Increased the Number of Foreign Drug Inspections Conducted in
Fiscal Year 2009:
FDA increased the number of foreign drug inspections conducted in
fiscal year 2009 compared to previous fiscal years. In fiscal year
2009, FDA conducted 424 foreign inspections, an increase from the 333
and 324 inspections conducted in fiscal years 2007 and 2008,
respectively. The rate at which FDA increased foreign drug inspections
from fiscal year 2007 to fiscal year 2009 was higher than the increase
in the annual inventory FDA compiled of foreign drug establishments
during the same period. In fiscal year 2009, FDA conducted 27 percent
more inspections than in fiscal year 2007.[Footnote 31] In comparison,
the total number of foreign establishments in FDA's inventory
increased by 16 percent--from 3,249 to 3,765--during the same period.
[Footnote 32] FDA conducted inspections in 37 countries in fiscal year
2009, with 77 percent of the inspections conducted in 10 countries, as
shown in table 1.
Table 1: Total Number of FDA Inspections of Foreign Establishments,
Fiscal Year 2007 through Fiscal Year 2009:
Most frequently inspected countries: India;
Number of inspections: Fiscal year 2007: 64;
Number of inspections: Fiscal year 2008: 64;
Number of inspections: Fiscal year 2009: 59;
Number of inspections: Total: 187;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 502.
Most frequently inspected countries: China;
Number of inspections: Fiscal year 2007: 19;
Number of inspections: Fiscal year 2008: 36;
Number of inspections: Fiscal year 2009: 52;
Number of inspections: Total: 107;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 920.
Most frequently inspected countries: Germany;
Number of inspections: Fiscal year 2007: 26;
Number of inspections: Fiscal year 2008: 34;
Number of inspections: Fiscal year 2009: 36;
Number of inspections: Total: 96;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 228.
Most frequently inspected countries: Italy;
Number of inspections: Fiscal year 2007: 28;
Number of inspections: Fiscal year 2008: 28;
Number of inspections: Fiscal year 2009: 30;
Number of inspections: Total: 86;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 168.
Most frequently inspected countries: Canada;
Number of inspections: Fiscal year 2007: 20;
Number of inspections: Fiscal year 2008: 19;
Number of inspections: Fiscal year 2009: 35;
Number of inspections: Total: 74;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 310.
Most frequently inspected countries: United Kingdom;
Number of inspections: Fiscal year 2007: 16;
Number of inspections: Fiscal year 2008: 17;
Number of inspections: Fiscal year 2009: 32;
Number of inspections: Total: 65;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 191.
Most frequently inspected countries: France;
Number of inspections: Fiscal year 2007: 24;
Number of inspections: Fiscal year 2008: 14;
Number of inspections: Fiscal year 2009: 26;
Number of inspections: Total: 64;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 188.
Most frequently inspected countries: Japan;
Number of inspections: Fiscal year 2007: 22;
Number of inspections: Fiscal year 2008: 17;
Number of inspections: Fiscal year 2009: 20;
Number of inspections: Total: 59;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 207.
Most frequently inspected countries: Switzerland;
Number of inspections: Fiscal year 2007: 17;
Number of inspections: Fiscal year 2008: 15;
Number of inspections: Fiscal year 2009: 18;
Number of inspections: Total: 50;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 100.
Most frequently inspected countries: Ireland;
Number of inspections: Fiscal year 2007: 14;
Number of inspections: Fiscal year 2008: 11;
Number of inspections: Fiscal year 2009: 19;
Number of inspections: Total: 44;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 63.
Most frequently inspected countries: All other countries;
Number of inspections: Fiscal year 2007: 83;
Number of inspections: Fiscal year 2008: 69;
Number of inspections: Fiscal year 2009: 97;
Number of inspections: Total: 249;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 888.
Most frequently inspected countries: Total;
Number of inspections: Fiscal year 2007: 333;
Number of inspections: Fiscal year 2008: 324;
Number of inspections: Fiscal year 2009: 424;
Number of inspections: Total: 1,081;
Estimated number of establishments in FDA's inventory, fiscal year
2009[A]: 3,765.
Source: GAO analysis of FDA FACTS and risk-based process data.
Note: The number of inspections includes preapproval inspections, GMP
inspections, and inspections that include both preapproval and GMP
components. The number of inspections does not include a small number
of other foreign drug inspections, such as inspections for the
President's Emergency Plan for AIDS Relief, inspections of clinical
trial sites, and inspections conducted to determine whether drug
manufacturers are submitting to FDA, as required, complete and
accurate data on adverse drug experiences associated with marketed
drugs, which were not included in the scope of our review.
[A] There were an estimated 3,249 and 3,559 foreign drug
establishments in FDA's inventory in fiscal years 2007 and 2008,
respectively.
[End of table]
According to FDA officials, the agency has made two types of staffing
changes--by creating a drug cadre based in the United States and by
staffing overseas offices with investigators--to increase the number
of foreign drug establishment inspections it conducted in fiscal year
2009. First, FDA created a foreign drug cadre consisting of 15
domestically based members in January 2009.[Footnote 33] Cadre members
are specifically dedicated to conducting foreign drug inspections. The
cadre members began conducting foreign inspections in January 2009 and
conducted 152 foreign inspections in 27 countries by the end of fiscal
year 2009.[Footnote 34] The countries most frequently inspected by the
foreign cadre were China and India, with 23 and 19 inspections,
respectively. Second, in late 2008 FDA opened overseas offices in
China and India and, since the middle of 2009, has had two medical
product investigators staffed to each office to conduct drug
inspections.[Footnote 35] These investigators receive a mix of
inspection assignments, including GMP inspections, and have additional
responsibilities not related to conducting inspections.[Footnote 36]
FDA officials told us that investigators in the overseas offices will
not conduct the majority of the inspections of foreign drug
establishments in these two countries.[Footnote 37] According to our
FACTS analysis, investigators in the overseas offices conducted one
drug manufacturing establishment inspection in China and two in India
in fiscal year 2009.[Footnote 38] These staffing changes have provided
FDA officials with a larger pool of investigators to conduct foreign
inspections. According to FDA officials, the agency plans to sustain
the increases in foreign inspections by maintaining the foreign drug
cadre and the overseas offices.
In addition to staffing changes, FDA has increased the resources
dedicated to conducting foreign drug inspections, with the largest
increase occurring in fiscal year 2009. FDA dedicated approximately
$10 million to foreign drug inspections in fiscal year 2007,[Footnote
39] and approximately $12 million for this purpose in fiscal year
2008. In fiscal year 2009, FDA dedicated approximately $41 million to
foreign drug inspections, which includes a portion of the supplemental
appropriation FDA received in fiscal year 2008.[Footnote 40] According
to FDA officials, the supplemental appropriation allowed the agency to
conduct more inspections in fiscal year 2009.[Footnote 41] The
supplemental appropriation also allowed FDA to hire additional
investigators to conduct foreign inspections. FDA officials told us
that although the agency hired additional investigators, the effect of
this hiring will not be fully realized until fiscal year 2011 due to
the time it takes to train investigators to become qualified to
conduct foreign drug inspections. FDA estimates it will dedicate about
$42 million in fiscal year 2010 to foreign drug inspections, and
approximately $50 million in fiscal year 2011.
FDA Continues to Inspect Few Foreign Establishments Relative to Its
Inspection of Domestic Establishments:
Although FDA increased the number of foreign drug establishment
inspections it conducted in fiscal year 2009, the agency continues to
inspect relatively few foreign establishments compared to its
inspection of domestic establishments. The number of foreign
establishments the agency inspected in fiscal year 2009 remained a
small portion of the total number of foreign establishments in FDA's
inventory, compared to the portion of domestic establishments
inspected. FDA inspected 11 percent of the total number of foreign
establishments in its inventory in fiscal year 2009, an increase from
the 10 percent and 9 percent of foreign establishments inspected in
fiscal year 2007 and fiscal year 2008, respectively.[Footnote 42] In
comparison, FDA inspected approximately 40 percent of domestic
establishments in fiscal year 2009. If FDA continued to conduct
foreign inspections at the rate it adhered to in fiscal year 2009--424
a year--it would take FDA about 9 years to inspect each of the 3,765
foreign establishments in FDA's inventory in fiscal year 2009 at least
one time.[Footnote 43] In contrast, FDA conducted 1,015 domestic
inspections in fiscal year 2009.[Footnote 44] If FDA continued to
conduct domestic inspections at this rate, it would inspect the 2,498
establishments in its fiscal year 2009 domestic inventory about once
every 2.5 years.
However, the rate at which FDA inspects establishments within any
given country differs. For example, in fiscal year 2009, FDA conducted
59 inspections in India and 52 in China. If FDA continued to inspect
establishments in its fiscal year 2009 inventory in these two
countries at the rate at which it inspected establishments in these
countries in fiscal year 2009, it would take FDA about 8.5 years to
inspect all of the 502 establishments in India once and about 18 years
to inspect all of the 920 establishments in China once.
FDA officials acknowledged that the agency is far from achieving
foreign inspection rates comparable to domestic inspection rates and,
without significantly increased inspectional capacity, its ability to
close this gap is highly unlikely. FDA also indicated that the agency
cannot respond to the nation's increasing reliance on the
globalization of the drug supply chain, in which manufacturing steps
may be outsourced to multiple foreign establishments, at its expected
fiscal year 2011 funding level. According to FDA, the sheer number of
foreign establishments, the complexity of the drug supply chain, and
the rapidly changing use of suppliers all pose formidable challenges
to its ability to gather comprehensive information about foreign
establishments and take action against them when necessary. In
addition, FDA noted that its current legal authorities limit the
agency's ability to improve its oversight of imported products.
[Footnote 45]
FDA's concern about its ability to close the gap in foreign and
domestic inspection rates is underscored by the proportion of
establishments in the agency's inventory that FDA may never have
inspected. A majority of foreign establishments in FDA's inventory may
never have been inspected by the agency, and almost half of these
establishments are in China and India. According to agency officials,
after compiling its inventory of foreign establishments that may be
subject to inspection, FDA identifies establishments in the inventory
that may never have received an FDA inspection. Of the 3,765 foreign
establishments in FDA's inventory for fiscal year 2009, there were
2,394 foreign establishments that may never have been inspected by FDA
(see table 2).[Footnote 46] This is an increase from the 2,133 foreign
establishments that may have never been inspected in fiscal year 2007.
In fiscal year 2009, 47 percent of the foreign establishments in FDA's
inventory that may never have been inspected by FDA were in China and
India. In comparison, 10 percent, or 253, of the 2,498 domestic
establishments in FDA's inventory for fiscal year 2009 may never have
been inspected.[Footnote 47] Agency officials told us that the count
of foreign establishments that FDA may never have inspected includes
registered establishments whose drugs are being imported into the
United States,[Footnote 48] as well as establishments that may not
actually be subject to inspection.[Footnote 49]
Table 2: Number of Establishments in FDA's Inventory That May Never
Have Been Inspected by FDA and the Total Estimated Number of
Establishments in Its Inventory, by Country, Fiscal Year 2009:
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: China;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 811;
Estimated number of establishments in FDA's inventory: 920;
Percent of establishments in FDA's inventory that may never have been
inspected: 88.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: India;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 323;
Estimated number of establishments in FDA's inventory: 502;
Percent of establishments in FDA's inventory that may never have been
inspected: 64.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: Canada;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 206;
Estimated number of establishments in FDA's inventory: 310;
Percent of establishments in FDA's inventory that may never have been
inspected: 66.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: France;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 107;
Estimated number of establishments in FDA's inventory: 188;
Percent of establishments in FDA's inventory that may never have been
inspected: 57.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: Japan;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 99;
Estimated number of establishments in FDA's inventory: 207;
Percent of establishments in FDA's inventory that may never have been
inspected: 48.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: Germany;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 97;
Estimated number of establishments in FDA's inventory: 228;
Percent of establishments in FDA's inventory that may never have been
inspected: 43.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: United Kingdom;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 82;
Estimated number of establishments in FDA's inventory: 191;
Percent of establishments in FDA's inventory that may never have been
inspected: 43.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: South Korea;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 69;
Estimated number of establishments in FDA's inventory: 75;
Percent of establishments in FDA's inventory that may never have been
inspected: 92.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: Mexico;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 57;
Estimated number of establishments in FDA's inventory: 76;
Percent of establishments in FDA's inventory that may never have been
inspected: 75.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: Italy;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 55;
Estimated number of establishments in FDA's inventory: 168;
Percent of establishments in FDA's inventory that may never have been
inspected: 33.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: All other countries;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 488;
Estimated number of establishments in FDA's inventory: 900;
Percent of establishments in FDA's inventory that may never have been
inspected: 54.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: Foreign total;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 2,394;
Estimated number of establishments in FDA's inventory: 3,765;
Percent of establishments in FDA's inventory that may never have been
inspected: 64.
Countries with the largest number of establishments in FDA's inventory
that may never have been inspected: Domestic total;
Number of establishments in FDA's inventory that may never have been
inspected[A]: 253;
Estimated number of establishments in FDA's inventory: 2,498;
Percent of establishments in FDA's inventory that may never have been
inspected: 10.
Source: GAO analysis of FDA risk-based process data.
[A] This count represents the number of establishments for which FDA
could not identify a previous inspection when FDA compiled its
inventory in fiscal year 2009. Officials told us that this count could
include establishments that received an inspection other than a GMP
inspection prior to fiscal year 2000, but that these data may not have
been transferred when the agency began using FACTS in fiscal year
2000. This count could also include establishments that are not
subject to inspection, such as those establishments that may have gone
out of business or those that have never shipped to the United States.
[End of table]
Inspections Conducted for Preapproval Purposes Continued to Drive the
Selection of Foreign Establishments for Inspection in Fiscal Year 2009:
While FDA mainly selected domestic establishments for inspection to
examine the manufacture of drugs already marketed in the United
States, it mainly selected foreign establishments for inspection for
preapproval purposes. Unless a foreign establishment is listed on an
application for a new drug, FDA is still unlikely to select that
establishment for inspection. In fiscal year 2009, 83 percent of
foreign drug establishment inspections contained preapproval
components--preapproval-only inspections and inspections including
both preapproval and GMP components--compared to 18 percent of
domestic drug establishment inspections. When a foreign establishment
was already selected to receive a preapproval inspection, FDA often
included a GMP inspection.[Footnote 50] However, relatively few
foreign establishments are selected for inspection solely to examine
the manufacture of drugs already marketed in the United States. In
fiscal year 2009, 17 percent of the 424 foreign inspections were GMP-
only inspections--that is, GMP inspections that do not include a
preapproval component (see fig. 1).[Footnote 51] In comparison, for
fiscal year 2009, GMP-only inspections continued to make up about 82
percent of domestic establishment inspections. This approach--in which
foreign establishments are primarily selected for inspection for
preapproval purposes while domestic establishments are primarily
selected to examine the manufacture of drugs already marketed in the
United States--is inconsistent with one of the recommendations we made
in 2008. Specifically, we recommended that FDA inspect, at a
comparable frequency, those establishments that are identified as
having the greatest public health risk potential if they experience a
manufacturing defect, regardless of whether they are a foreign or
domestic establishment.
Figure 1: FDA Foreign and Domestic Drug Establishment Inspections by
Type of Inspection, Fiscal Year 2009:
[Refer to PDF for image: 2 pie-charts]
Foreign drug establishment inspections: total 424:
Preapproval: 9%;
GMP-only: 17%;
Both preapproval and GMP: 74%.
Domestic drug establishment inspections: total 1,015:
Preapproval: 3%;
GMP-only: 82%;
Both preapproval and GMP: 15%.
Source: GAO analysis of FDA FACTS data.
[End of figure]
The majority of foreign inspections conducted in the 10 most
frequently inspected countries in fiscal year 2009 had a preapproval
component (see table 3). For example, of the 59 inspections conducted
in India in fiscal year 2009, 50 had a preapproval component; that is,
these included both preapproval-only inspections and inspections
including both preapproval and GMP components. In China, 35 of the 52
inspections conducted had a preapproval component.
Table 3: Number of Inspections Conducted by Inspection Type for the
Most Frequently Inspected Countries in Fiscal Year 2009:
Most frequently inspected countries: India;
Number of preapproval-only inspections: 5;
Number of both preapproval and GMP inspections: 45;
Number of GMP-only inspections: 9;
Total number of inspections: 59.
Most frequently inspected countries: China;
Number of preapproval-only inspections: 7;
Number of both preapproval and GMP inspections: 28;
Number of GMP-only inspections: 17;
Total number of inspections: 52.
Most frequently inspected countries: Germany;
Number of preapproval-only inspections: 6;
Number of both preapproval and GMP inspections: 24;
Number of GMP-only inspections: 6;
Total number of inspections: 36.
Most frequently inspected countries: Canada;
Number of preapproval-only inspections: 0;
Number of both preapproval and GMP inspections: 30;
Number of GMP-only inspections: 5;
Total number of inspections: 35.
Most frequently inspected countries: United Kingdom;
Number of preapproval-only inspections: 3;
Number of both preapproval and GMP inspections: 26;
Number of GMP-only inspections: 3;
Total number of inspections: 32.
Most frequently inspected countries: Italy;
Number of preapproval-only inspections: 5;
Number of both preapproval and GMP inspections: 20;
Number of GMP-only inspections: 5;
Total number of inspections: 30.
Most frequently inspected countries: France;
Number of preapproval-only inspections: 1;
Number of both preapproval and GMP inspections: 23;
Number of GMP-only inspections: 2;
Total number of inspections: 26.
Most frequently inspected countries: Japan;
Number of preapproval-only inspections: 0;
Number of both preapproval and GMP inspections: 14;
Number of GMP-only inspections: 6;
Total number of inspections: 20.
Most frequently inspected countries: Ireland;
Number of preapproval-only inspections: 0;
Number of both preapproval and GMP inspections: 16;
Number of GMP-only inspections: 3;
Total number of inspections: 19.
Most frequently inspected countries: Switzerland;
Number of preapproval-only inspections: 4;
Number of both preapproval and GMP inspections: 13;
Number of GMP-only inspections: 1;
Total number of inspections: 18.
Most frequently inspected countries: All other countries;
Number of preapproval-only inspections: 9;
Number of both preapproval and GMP inspections: 73;
Number of GMP-only inspections: 15;
Total number of inspections: 97.
Most frequently inspected countries: Foreign total;
Number of preapproval-only inspections: 40;
Number of both preapproval and GMP inspections: 312;
Number of GMP-only inspections: 72;
Total number of inspections: 424.
Most frequently inspected countries: Domestic total;
Number of preapproval-only inspections: 35;
Number of both preapproval and GMP inspections: 151;
Number of GMP-only inspections: 829;
Total number of inspections: 1,015.
Source: GAO analysis of FDA FACTS data.
[End of table]
Although preapproval inspections drove the selection of establishments
for inspection, FDA increased the number of foreign establishments
inspected from the agency's annual prioritized list. Based on the
application of its risk-based process, CDER forwarded to ORA a list of
104 and 120 foreign establishments that it considered to be a priority
for inspection in fiscal years 2007 and 2008, respectively. In fiscal
year 2007, ORA inspected 29 establishments from the prioritized list,
and FDA increased this number of establishments inspected in fiscal
year 2008 to 56. CDER followed the same process in fiscal year 2009,
submitting a list of 220 foreign establishments. ORA inspected 88
establishments from the fiscal year 2009 prioritized list.[Footnote 52]
FDA Is Taking Steps to Improve Its Information on Foreign Drug
Establishments, but These Efforts Are in the Early Stages:
FDA is pursuing initiatives to improve the information it receives
from its drug establishment registration and import databases, DRLS
and OASIS, respectively, but these efforts are in the early stages.
FDA is taking additional steps to improve its information on foreign
drug establishments.
FDA Is Pursuing Initiatives to Improve Its Information on Registered
Foreign Drug Establishments, but Efforts Are Preliminary and
Inaccuracies Remain:
FDA is taking steps to improve the information it obtains from
establishments through the registration process by moving from a paper-
based registration system--DRLS--to an electronic registration and
listing system, known as eLIST. In June 2009, FDA began requiring all
drug establishments marketing their products in the United States to
submit their annual registration and listing information
electronically through eLIST, rather than submitting the information
on paper forms to be entered into DRLS.[Footnote 53] The intent of
eLIST is to provide FDA with more accurate information on foreign
establishments by reducing the potential for human error associated
with the transcription of information from paper forms to electronic
files. According to an FDA official, the agency currently does not
have enough data to tell whether the implementation of electronic
registration has improved the agency's foreign establishment
registration data.[Footnote 54] However, FDA will continue to study
the effect that the implementation of electronic registration has had
on the accuracy of data obtained from establishments.[Footnote 55]
In another initiative designed to improve registration information,
FDA issued guidance that requests that establishments voluntarily
submit a unique identification number--a Dun and Bradstreet Data
Universal Numbering System (D-U-N-S®) Number--as a part of their
electronic registration.[Footnote 56] The D-U-N-S® Number is intended
to serve as a recognized identifier to avoid duplications and errors
in FDA's data systems. Also, the D-U-N-S® Number and the associated
data to which it is linked should allow FDA to verify information
about foreign establishments, including whether they have gone out of
business or relocated.
According to FDA officials, as the first part of a larger planned
verification effort using the D-U-N-S® Number, when an establishment
submits a D-U-N-S® Number with its registration data, FDA verifies the
country code in the establishment's address and has done so since the
fall of 2009.[Footnote 57] If the country code submitted with an
establishment's registration does not match the country code on file
for that establishment in the Dun and Bradstreet database, the
registration file is returned to the establishment for correction. FDA
and Dun and Bradstreet are developing an algorithm that is intended to
allow FDA to implement a more complete verification process that will
include additional aspects of an establishment's registration
information, such as the establishment's full name, city, and street
address. The time frame for implementing this more complete
verification procedure is unclear, although FDA officials told us that
they hoped to implement the algorithm by the end of calendar year
2010.[Footnote 58]
FDA acknowledged that the implementation of eLIST and the related
guidance requesting that establishments submit a D-U-N-S® Number at
the time of registration do not represent a comprehensive solution to
the problems we previously identified regarding the accuracy of FDA's
registration information. For example, in 2008 we reported that FDA
did not enforce the requirement that establishments submit their
registration information annually. Some foreign establishments may not
report to FDA if they stop manufacturing drugs for the U.S. market or
go out of business, although establishments are required to do so.
Because FDA did not enforce the annual registration requirement, these
establishments may still be listed as actively registered
establishments. Also, we reported that FDA's registration data
contained information on foreign establishments that may have
registered with FDA whether or not they actually manufacture drugs for
the U.S. market. DRLS, which in fiscal year 2009 contained information
on approximately 3,200 foreign drug establishments, still does not
provide FDA with a complete count of establishments subject to
inspection.[Footnote 59] FDA confirmed that establishments that do not
need to register with FDA continue to submit registration files, that
those required to update their registration information annually do
not always do so, and that FDA still relies on multiple databases to
estimate the number of foreign establishments actually shipping drugs
to the United States.
OASIS Continues to Contain Inaccurate Data on the Number of
Establishments Offering Drugs for Import, but FDA Is Exploring Options
to Prevent Future Inaccuracies:
According to FDA officials, OASIS still provides an inaccurate count
of foreign establishments manufacturing drugs offered for import into
the United States, and the agency is exploring options for preventing
this problem in the future. In fiscal year 2009, OASIS contained
information on about 7,000 foreign establishments that offered drugs
for import into the United States, compared with the approximately
3,200 foreign drug establishments that were registered with FDA in
that year.[Footnote 60] As we previously reported, this inaccurate
count of establishments in OASIS is the result of unreliable
manufacturer identification numbers generated by customs brokers when
a drug is offered for import.[Footnote 61]
FDA has initiated a project to identify and resolve duplication of
existing data, including duplication of data on foreign drug
establishments offering their products for import into the United
States. It is taking steps to identify and remove all duplicate drug
establishment records from existing import data within the next couple
of years. As a result of this effort, FDA expects that it may be
easier to more precisely identify the total number of establishments
that have offered drugs for import into the United States. Identifying
and resolving duplicates in existing import data is important because
FDA uses information on establishment shipping history from OASIS to
select establishments for inspection.[Footnote 62]
In addition to its project to resolve existing duplications in OASIS
data, FDA officials told us that the agency continues to support a
proposal that could help prevent future duplication errors in OASIS
across all product areas, but FDA does not control the implementation
of this proposal. FDA, in conjunction with 20 of the nearly 50 federal
agencies involved in the oversight of products imported into the
United States, requested that CBP use the D-U-N-S® Number as a unique
establishment identifier for all establishments whose products,
including drugs, are imported into the United States. The
implementation of this unique establishment identifier depends on
changes to CBP's import and export system. In 2009, CBP agreed to
modify its import and export system to accept the D-U-N-S® Number for
all FDA-regulated products (e.g., foods, drugs, and medical devices).
However, as of March 2010, the system had not been modified, and CBP
had not established a schedule and target date to do so.
FDA officials told us that they are developing a pilot program to
study the feasibility of obtaining and validating additional
information from establishments during the import process, such as the
D-U-N-S® Number, in the event that CBP does not adopt changes to its
import and export system. This may help FDA address the problems with
information on the number of foreign drug establishments in OASIS. As
of July 2010, FDA had not yet developed an implementation plan for the
pilot program. The agency has, however, identified 10 potential
participants for the program, but some of these participants had not
yet submitted their updated electronic annual registration as of May
2010. In addition, FDA is in the process of updating some of its
information-technology infrastructure, further delaying implementation
of the pilot program.
FDA Is Taking Additional Steps to Improve Its Information on Foreign
Drug Establishments:
In addition to initiatives to enhance DRLS and OASIS, FDA is taking
other steps to improve the information that the agency maintains on
foreign establishments shipping drugs to the United States. In August
2008, FDA contracted with two external organizations to implement the
Foreign Registration Verification Program.[Footnote 63] Through this
program, contractors conduct site visits to verify the existence of
foreign establishments that are registered with FDA and confirm that
they manufacture the products that are recorded in U.S. import
records. According to FDA officials, establishments that are new to
the U.S. market or are importing products not typically manufactured
at the same establishment are considered candidates for the
verification program.[Footnote 64] For example, FDA officials told us
about an establishment that was selected for the program because,
according to agency records, it was offering for import into the
United States pickles and an API--two products not normally
manufactured at the same establishment.
As of July 2010, the contractors had visited 43 foreign drug
establishments located in Canada, Europe, and Asia, 7 of which did not
appear to exist at the address provided by the establishments at the
time of registration.[Footnote 65] According to agency officials, FDA
took action against 2 of the establishments that appeared not to exist
by deactivating their registration and alerting FDA import staff so
they can detain any products offered for import by these
establishments, thus preventing these products from being imported
into the United States.[Footnote 66] FDA officials noted that most of
the drug establishments visited under the Foreign Registration
Verification Program were OTC manufacturing establishments, which are
infrequently inspected under FDA's foreign drug inspection program,
and API manufacturing establishments.
FDA has also implemented collaborative efforts with foreign regulatory
authorities to exchange information about planned inspections as well
as the results of completed inspections. In December 2008, FDA, along
with its counterpart regulatory authorities of the European Union and
Australia, initiated a pilot program under which the three regulators
share their preliminary plans for and results of inspections of API
manufacturing establishments in other countries. For example, FDA
could receive the results of inspections conducted by these regulatory
bodies and then determine if regulatory action or a follow-up
inspection is necessary. FDA contends that prospectively sharing this
information will allow these regulatory bodies to more efficiently use
their resources by minimizing the overlap in their inspection plans.
Since September 2008, FDA had requested 47 inspection reports for API
manufacturing establishments. As of July 2010, it had received 13 of
the 47 reports requested. According to agency officials, this
information was used by FDA to improve its knowledge of
establishments, most of which had not been inspected in the last 3
years, but that it was interested in inspecting due to a pending drug
application. In addition to the inspection reports received through
this pilot program, FDA also received 13 additional inspection reports
from various foreign drug regulatory authorities, including New
Zealand and Canada. These reports helped FDA evaluate the GMP
compliance status of several API and finished drug product
manufacturing establishments.
Concluding Observations:
Our work over the last decade has identified long-standing concerns
regarding FDA's ability to respond to the challenges posed by the
globalization of drug manufacturing. In 1998, and again in 2008, we
reported that FDA needed to conduct more inspections of foreign
establishments and that it was vital that the agency strengthen the
data it uses to manage its foreign drug inspection program. Among
other things, our 2008 report recommended that FDA conduct more
inspections of foreign establishments and that it address weaknesses
in the data systems it uses to help select establishments for
inspection. FDA has acknowledged that its approach to inspecting
foreign drug manufacturing establishments has not kept pace with the
realities of the global marketplace.
We recognize that FDA has made improvements in its foreign drug
inspection program since our 2008 report was issued by increasing the
number of foreign inspections it conducted. However, we recommended
that FDA inspect, at a comparable frequency, those establishments that
are identified as having the greatest public health risk potential if
they experience a manufacturing defect, regardless of whether they are
a foreign or domestic establishment. FDA has not done so. Instead, its
foreign inspections continue to be driven by the establishments listed
on an application for a new drug, instead of inspections of
establishments already producing drugs for the U.S. market. FDA is
also taking steps to obtain more complete and accurate information on
foreign establishments marketing drugs in the United States. We
believe that these efforts to collect and maintain more complete and
accurate information on foreign establishments may be instrumental in
helping FDA improve its oversight. However, these steps appear to
involve long-term efforts that are in their early stages and it is
unclear if these efforts will prove successful. In the meantime, FDA's
data systems continue to contain inaccurate information on foreign
establishments, compromising the agency's oversight of the nation's
drug supply.
The challenges FDA faces in managing its foreign drug inspection
program are not new, as our prior work shows. Given the long-standing
nature of these challenges and the nation's reliance on drugs
manufactured overseas, we believe that there is an urgent need for FDA
to better protect the public health by implementing our prior
recommendations.
Agency Comments and Our Evaluation:
HHS reviewed a draft of this report and agreed that more progress is
needed in order to meet the challenge of safeguarding the nation's
drug supply in today's global marketplace. HHS underscored FDA's
position that relying solely on inspections is insufficient to secure
the drug supply chain and noted that, due to globalization and
outsourcing, the drug supply chain has become more nebulous and
complex. According to HHS, drug products are more likely to change
hands during manufacture and distribution without adequate
traceability. As a consequence, HHS said that FDA faces challenges
from a proliferation of new entry points through which contaminated,
adulterated, and otherwise violative products can infiltrate the drug
supply. In addition, HHS described several practical and
jurisdictional issues that affect FDA's ability to gather information
during foreign inspections, such as the need to obtain permission from
the foreign government of the country in which an establishment is
located in order to conduct an inspection. HHS emphasized that, to be
effective, inspections must be informed by relevant data from other
sources. To that end, it elaborated on FDA's efforts to enhance its
global presence and cited additional efforts that FDA has initiated
that may lead to greater international cooperation on drug safety
issues, such as the opening of FDA offices in several foreign
countries and conducting joint inspections with foreign regulatory
authorities.
HHS also stressed that FDA has made many of the improvements
recommended in our 2008 report, such as enhancing its registration
data. However, it also specifically cited obstacles related to one of
our 2008 recommendations regarding the varying rates of inspections
between foreign and domestic establishments. HHS pointed out that, if
FDA were to conduct foreign GMP surveillance inspections at a rate
comparable to domestic GMP surveillance inspections, given current
resources, the inspection frequency for both would be, at most, about
once every 7 years. However, we did not recommend that FDA inspect all
foreign and domestic establishments at a comparable frequency, rather,
we recommended that FDA inspect foreign establishments at a frequency
comparable to domestic establishments with similar characteristics. We
continue to maintain that FDA should ensure that it is frequently
inspecting those establishments, foreign or domestic, that pose the
greatest potential risk to public health should they experience a
manufacturing defect.
HHS's comments are reprinted in appendix I. HHS also provided us with
one technical comment, which we incorporated.
As agreed with your offices, unless you publicly announce the contents
of this report earlier, we plan no further distribution until 30 days
from the report date. At that time, we will send copies to the
appropriate congressional committees, the Commissioner of FDA, and
other interested parties. The report also will be available at no
charge on the GAO Web site at [hyperlink, http://www.gao.gov].
If you or your staff have any questions about this report, please
contact me at (202) 512-7114 or crossem@gao.gov. Contact points for
our offices of Congressional Relations and Public Affairs may be found
on the last page of this report. GAO staff who made key contributions
to this report are listed in appendix II.
Signed by:
Marcia Crosse:
Director, Health Care:
[End of section]
Appendix I: Comments from the Department of Health and Human Services:
Department Of Health & Human Services:
Office Of The Secretary:
Assistant Secretary for Legislation:
Washington, DC 20201:
September 9, 2010:
Marcia Crosse:
Director, Health Care:
U.S. Government Accountability Office:
441 G Street N.W.
Washington, DC 20548:
Dear Ms. Crosse:
Attached are comments on the U.S. Government Accountability Office's
(GAO) report entitled: "Drug Safety: FDA Has Conducted More Foreign
Inspections and Begun to Improve its Information on Foreign
Establishments, but More Progress Is Needed" (GAO-10-961).
The Department appreciates the opportunity to review this report
before its publication.
Sincerely,
Signed by:
Jim Esquea:
Assistant Secretary for Legislation:
Attachment:
[End of letter]
General Comments Of The Department Of Health And Human Services (HHS)
To The Government Accountability Office's (GAO) Draft Report Entitled,
"Drug Safety: FDA Has Conducted More Inspections And Begun To Improve
Its Information On Foreign Establishments, But More Progress Is
Needed" (GAO-10-961):
The Department appreciates the opportunity to comment on the GAO's
findings in this draft report. HHS and FDA appreciate GAO's
recognition of the progress FDA has made toward strengthening its
foreign inspection capability within the past two years, and agree
that more progress is needed in order to meet the challenge of
safeguarding the nation's drug supply in today's globalized
marketplace.
In 2008, GAO published a report recommending that, among other things,
FDA conduct more inspections of foreign establishments and address
weaknesses in the data systems FDA uses to manage its foreign
inspection program. Since then, FDA has made many of the recommended
improvements and initiated additional efforts that may lead to greater
international cooperation on drug safety issues.
As a result of these initiatives, FDA's presence abroad is greater
today than it has ever been, and FDA's foreign inspection capacity is
on the rise. In 2009, FDA conducted 424 foreign inspections concerning
drugs intended for human use, the highest number of inspections to
date, representing nearly a 31 percent increase over the 324 foreign
inspections that FDA conducted in 2008.
Establishment inspections -- both domestic and foreign -- provide a
system for determining that a firm's manufacturing practices comply
with U.S. legal standards for assuring the safety, quality and purity
of active pharmaceutical ingredients (APIs) and drug products.
Although establishment inspections are an essential element of FDA's
drug safety efforts, given the ever-increasing scope and ever-changing
design of the drug production and distribution systems, FDA cannot
rely solely on inspections to secure the drug supply chain, and to be
effective, inspections must be informed by relevant data from other
sources.
In the past decade or so, the pharmaceutical industry has shifted a
large part of its manufacturing operations and supply sourcing
overseas. Today, nearly 40 percent of the finished dosage form drugs
Americans take are imported, and nearly 80 percent of the active
ingredients used to formulate the drugs on the American market come
from overseas sources. Furthermore, due to globalization and
outsourcing, the supply chain -- from raw material to finished
product -- has become more nebulous and complex, so that drug products
are more likely to change hands during manufacture and distribution
without adequate traceability. Like any chain, the drug supply chain
is only as strong as its weakest link, and the proliferation of
additional handlers, suppliers and middlemen creates new entry points
through which contaminated, adulterated, counterfeit, and otherwise
violative products can infiltrate the drug supply.
FDA protects the American people from unsafe and poor quality drug
products by holding the industry accountable for the integrity,
purity, quality and safety of its drug products. A drug company's
obligation does not begin or end in its manufacturing facility; it
extends from the first filing of a new drug application or an
abbreviated new application to every single link in the firm's supply
chain until the product reaches the consumer. The same is true for
products not covered by applications (e.g., over-the-counter products).
Challenges in Meeting GAO's Goals for the Foreign Inspection Program:
Despite the significant progress FDA has made toward improving the
Agency's foreign inspection operations and capacity, it is important
to acknowledge the nature and the depth of the challenges FDA faces in
the foreign inspection arena. The sheer number of foreign facilities,
the complexity of the drug supply chain, and the rapidly changing use
of suppliers all pose formidable obstacles to implementing GAO's
recommendation that FDA conduct foreign inspections at a rate
comparable to domestic inspections. FDA has estimated that if it were
to conduct foreign Good Manufacturing Practices (GMP) surveillance
inspections at a rate comparable to domestic GMP surveillance
inspections, the inspection frequency for both, under current
resources, would be, at most, about once every 7 years. This lower
bound estimate does not take into consideration several practical
matters, and so overestimates how often FDA would be able to conduct
such inspections. For example, FDA does not currently have sufficient
trained and experienced investigators to conduct inspections at these
rates, and it would take several years of sustained effort to develop
sufficient numbers of such investigators.
As GAO recognized in 2008, the Agency also faces a number of practical
and other jurisdictional issues that affect its ability to gather
information during foreign inspections. For instance, during domestic
inspections, FDA inspectors arrive unannounced to observe drug
establishments under conditions that represent normal day-to-day
activities. In contrast and for a variety of reasons, FDA is generally
unable to conduct foreign inspections unannounced. First, the time and
expense associated with foreign travel necessitate that inspectors
ensure that managers of foreign establishments are available at the
time of the inspection and that the production lines being inspected
are operational during the inspection. Second, FDA often needs
permission from the foreign government of the country in which the
establishment is located in order to conduct the inspection. In some
countries, visas or letters of invitation are required for the
inspectors to enter the country in which the establishment is located.
Third, there is little flexibility to extend inspections in foreign
countries when the Agency encounters difficulties in an establishment
because of the need to adhere to a tight schedule. As a consequence,
FDA generally must contact establishments it identifies for
surveillance inspections to arrange the inspections, and
establishments are [far] more likely to schedule the inspections with
the Agency when they have, or know they will soon have, a drug
application under review at the Agency for a preapproval inspection.
Finally, we note that many of the issues raised in GAO's report would
be affected by legislation currently under consideration by Congress
to grant FDA new authorities to ensure the safety of our nation's drug
supply. The Administration has not yet taken a position on additional
authorities for drugs; however, the Administration strongly
supports passage of pending food safety legislation that would require
food manufacturers to have controls and systems in place to prevent
safety problems, and would provide FDA with several important
enforcement authorities, including civil money penalties, subpoena
authority, registration of importers, unique identifiers for food
facilities, explicit authority to refuse entry of food from a facility
that has refused or delayed an inspection, and mandatory recall
authority.
Increasing Global Presence and International Collaboration and
Capacity:
Given the challenges that it faces in the foreign inspections arena,
FDA has undertaken efforts to more effectively secure the drug supply
chain by complementing its inspections through additional measures,
such as enhancing its global presence and international collaboration
and capacity.
Among other things, such efforts include establishing a physical
presence in countries that are ever more active in the production of
raw materials and drug components; creating cooperative agreements to
leverage inspection capabilities among international regulators; and
working to create more uniformity among drug safety standards
throughout the world. Over the past two years, FDA has made
significant progress toward these mutually supportable goals.
Foreign Offices: In November 2008 the Agency began posting FDA
employees in foreign posts in key locations overseas. FDA has opened
offices in several countries where an FDA presence can help to improve
product safety and quality, and leverage resources. To date, FDA has
offices in India (Mumbai and New Delhi), China (Shanghai, Guangzhou,
and Beijing), Europe (Brussels, Belgium), and Latin America (San Jose,
Costa Rica; Santiago, Chile; and Mexico City, Mexico), and the Agency
has plans for a Middle East office. FDA has investigators posted in
Mumbai, Shanghai, and Guangzhou. The establishment of these foreign
offices has enabled FDA to enhance its relationships with foreign
counterpart regulatory officials to obtain more accurate and robust
information about foreign drug establishments and has facilitated FDA
access to drug establishments for inspection.
Dedicated Foreign Cadre: The Agency also has established a specialized
foreign cadre of investigators located in FDA district offices in the
United States who are dedicated to foreign inspection assignments. The
program selects investigators with professional experience
specifically related to pharmaceutical inspections and other relevant
knowledge and skills. Now in its second year, the program has 15
investigators and has already significantly increased the number of
foreign inspections as it has grown.
International Collaboration: In addition, FDA has substantially
increased its collaboration with foreign regulatory authorities. For
example, FDA participates in the API Pilot Program with the European
Medicines Agency (EMA) and Australia's Therapeutic Goods
Administration (TGA), which calls for participants to share
information, as permitted by law, about API inspections and to use
this information to leverage the inspectional resources of each
regulatory body.
Through this pilot program, FDA has participated in two successful
joint inspections, one with the EMA in Croatia and one with the TGA in
Mexico. FDA's goal for the pilot program this fiscal year is to
conduct four joint inspections (two with each participating authority)
and to increase the number of information exchanges with the
participating authorities. In 2009, FDA also conducted joint
inspections with the drug regulatory authorities of Ireland and the
United Kingdom and collaborated on investigations with regulatory
officials in Norway, Canada, Australia, Austria, Israel and New Zealand.
FDA also continues to work with other regulatory partners to establish
more consistent guidelines and standards for good manufacturing
practices in many countries throughout the world.
FDA also maintains Memoranda of Understanding with countries to
facilitate cooperation and Confidentiality Commitments that allow the
exchange of non-public information relating to product safety, quality
and effectiveness.
Improvements in FDA's Databases:
The 2008 GAO report highlighted deficiencies in FDA's registration
data and inspection information systems. FDA's old drug registration
and listing system (DRLS), for example, relied on manual entry of hard
copy data, a cumbersome process that required reviewers to add hard
copy data manually into an electronic database. As GAO noted in its
prior report, this process created opportunities for human error and
often resulted in a lag between the time FDA received registration
information and the time that information was entered into the
electronic database.
In keeping with GAO's observations about DRLS, FDA has implemented the
electronic drug registration and listing system (eDRLS). With the
implementation of eDRLS, it is mandatory for all drug establishments
shipping drugs to the United States to register with FDA
electronically. The implementation of eDRLS helps FDA more quickly to
assemble information about drug establishments. Also, given that eDRLS
is updated on a daily basis, FDA's import entry reviewers have near
real-time access to registration information, and they quickly flag
unregistered foreign firms and unlisted drugs when offered for
importation at ports and borders.
The new registration system also requires that importing firms submit
more comprehensive information. As the Agency fully implements the
electronic registration system, reviewers will be able to quickly and
easily validate information required as part of importation.
In conjunction with the rollout of eDRLS, FDA also has taken steps to
use secondary verification of drug establishments in eDRLS through a
widely used universal establishment identifier. In May 2009, FDA
published a guidance requesting the submission of a Data Universal
Number System (D-U-N-S) number during the electronic registration
process. Each DUNS number is unique to a particular business
establishment and is available free of charge from Dun & Bradstreet,
which maintains a database of all DUNS numbers and their corresponding
business entities. As these DUNS numbers begin to populate eDRLS, they
can assist FDA in verifying information about foreign establishments.
Over the last two years, FDA substantially has increased its
inspection capacity, improved its databases, and expanded its
infrastructure to increase its global presence. FDA remains dedicated
to addressing the multiple challenges posed by the globalization of
the pharmaceutical industry. Building on the progress FDA has made
since 2008 will require the commitment and engagement of FDA as well
as its stakeholders.
[End of section]
Appendix II: GAO Contact and Staff Acknowledgments:
GAO Contact:
Marcia Crosse, (202) 512-7114, crossem@gao.gov:
Staff Acknowledgments:
In addition to the contact named above, Geraldine Redican-Bigott,
Assistant Director; Katherine L. Amoroso; Amyre Barker; Cathleen
Hamann; Julian Klazkin; and Sarah Resavy made key contributions to
this report.
[End of section]
Related GAO Products:
Food and Drug Administration: Overseas Offices Have Taken Steps to
Help Ensure Import Safety, but More Long-term Planning Is Needed.
[hyperlink, http://www.gao.gov/products/GAO-10-960]. Washington, D.C.:
September 30, 2010.
High-Risk Series: An Update. [hyperlink,
http://www.gao.gov/products/GAO-09-271]. Washington, D.C.: January
2009.
Drug Safety: Better Data Management and More Inspections Are Needed to
Strengthen FDA's Foreign Drug Inspection Program. [hyperlink,
http://www.gao.gov/products/GAO-08-970]. Washington, D.C.: September
22, 2008.
Medical Devices: FDA Faces Challenges in Conducting Inspections of
Foreign Manufacturing Establishments. [hyperlink,
http://www.gao.gov/products/GAO-08-780T]. Washington, D.C.: May 14,
2008.
Drug Safety: Preliminary Findings Suggest Recent FDA Initiatives Have
Potential, but Do Not Fully Address Weaknesses in Its Foreign Drug
Inspection Program. [hyperlink,
http://www.gao.gov/products/GAO-08-701T]. Washington, D.C.: April 22,
2008.
Medical Devices: Challenges for FDA in Conducting Manufacturer
Inspections. [hyperlink, http://www.gao.gov/products/GAO-08-428T].
Washington, D.C.: January 29, 2008.
Drug Safety: Preliminary Findings Suggest Weaknesses in FDA's Program
for Inspecting Foreign Drug Manufacturers. [hyperlink,
http://www.gao.gov/products/GAO-08-224T]. Washington, D.C.: November
1, 2007.
Prescription Drugs: Strategic Framework Would Promote Accountability
and Enhance Efforts to Enforce the Prohibitions on Personal
Importation. [hyperlink, http://www.gao.gov/products/GAO-05-372].
Washington, D.C.: September 8, 2005.
Food and Drug Administration: Improvements Needed in the Foreign Drug
Inspection Program. [hyperlink,
http://www.gao.gov/products/GAO/HEHS-98-21]. Washington, D.C.: March
17, 1998.
[End of section]
Footnotes:
[1] Drugs are defined to include, among other things, articles
intended for use in the diagnosis, cure, mitigation, treatment, or
prevention of disease, and include components of those articles. 21
U.S.C. § 321(g)(1)(B), (D).
[2] FDA regulations define manufacturing to include the manufacture,
preparation, propagation, compounding, or processing of a drug. 21
C.F.R. § 207.3(a)(8) (2010). In addition, FDA regulations define an
establishment as a place of business under one management at one
general physical location. 21 C.F.R. § 207.3(a)(7) (2010). Drug firms
may have more than one establishment.
[3] Statement of Joshua M. Sharfstein, M.D., FDA Principal Deputy
Commissioner, before the Subcommittee on Health, Committee on Energy
and Commerce, House of Representatives (Washington, D.C.: Mar. 10,
2010).
[4] GMPs provide a framework for a manufacturer to follow to produce
safe, pure, and high-quality drugs. See 21 C.F.R. pts. 210, 211
(2010). See also International Conference on Harmonisation of
Technical Requirements for Registration of Pharmaceuticals for Human
Use, ICH Harmonised Tripartite Guideline: Good Manufacturing Practice
Guide for Active Pharmaceutical Ingredients Q7 (Geneva, Switzerland:
Nov. 10, 2000).
[5] GAO, Food and Drug Administration: Improvements Needed in the
Foreign Drug Inspection Program, [hyperlink,
http://www.gao.gov/products/GAO/HEHS-98-21] (Washington, D.C.: Mar.
17, 1998).
[6] Statement of Sharon Smith Holston, FDA Deputy Commissioner for
External Affairs, before the Subcommittee on Oversight and
Investigations, Committee on Commerce, House of Representatives
(Washington, D.C.: Oct. 2, 1998).
[7] GAO, Drug Safety: Better Data Management and More Inspections Are
Needed to Strengthen FDA's Foreign Drug Inspection Program,
[hyperlink, http://www.gao.gov/products/GAO-08-970] (Washington, D.C.:
Sept. 22, 2008).
[8] Biologics are materials, such as vaccines, derived from living
sources, such as humans, animals, and microorganisms. See 42 U.S.C. §
262(i); 21 C.F.R. § 600.3(h) (2010).
[9] Medical devices include instruments, apparatuses, machines, and
implants that are intended for use to diagnose, cure, treat, or
prevent disease, or to affect the structure or any function of the
body. 21 U.S.C. § 321(h).
[10] GAO, High-Risk Series: An Update, [hyperlink,
http://www.gao.gov/products/GAO-09-271] (Washington, D.C.: January
2009). The January 2009 addition of FDA's oversight of medical
products to our High-Risk Series followed our inclusion of federal
oversight--including FDA's oversight--of food safety in our High-Risk
Series in 2007.
[11] GAO, Food and Drug Administration: FDA Faces Challenges Meeting
Its Growing Medical Product Responsibilities and Should Develop
Complete Estimates of Its Resource Needs, [hyperlink,
http://www.gao.gov/products/GAO-09-581] (Washington, D.C.: June 19,
2009); Food Safety: Agencies Need to Address Gaps in Enforcement and
Collaboration to Enhance Safety of Imported Food, [hyperlink,
http://www.gao.gov/products/GAO-09-873] (Washington, D.C.: Sept. 15,
2009); and Food and Drug Administration: Opportunities Exist to Better
Address Management Challenges, [hyperlink,
http://www.gao.gov/products/GAO-10-279] (Washington, D.C.: Feb. 19,
2010).
[12] GAO, Information Technology: FDA Needs to Establish Key Plans and
Processes for Guiding Systems Modernization Efforts, [hyperlink,
http://www.gao.gov/products/GAO-09-523] (Washington, D.C.: June 2,
2009).
[13] Our September 2008 report included information on drug
manufacturing establishment inspections conducted from fiscal years
2002 to 2007. For this report, we focused on drug manufacturing
establishment inspections conducted from fiscal years 2007 through
2009. We obtained inspection data as of December 1, 2009, thus fiscal
year 2009 represented the most recent complete fiscal year of data
available at that time.
[14] Domestic and foreign establishments that manufacture drugs for
the U.S. market are required to register annually with FDA. 21 U.S.C.
§ 360(b), (i)(1). FDA's import database contains information on drugs
and other FDA-regulated products offered for entry into the United
States, including information on the establishment that manufactured
the drug.
[15] Biologics are generally regulated by FDA's Center for Biologics
Evaluation and Research. Biologics regulated by this center are not
addressed in this report. However, some biologics are regulated by
CDER and inspections related to those products are included in our
work.
[16] While our work examines a major part of FDA's foreign drug
inspection program, it does not examine all foreign drug inspections
the agency conducts. Our work focuses on inspections related to the
drug approval process or inspections conducted to determine an
establishment's ongoing compliance with laws and regulations in the
manufacture of drugs already marketed in the United States. FDA
conducts additional foreign drug inspections that are beyond the scope
of our review, such as inspections conducted to determine whether drug
manufacturers are submitting to FDA, as required, complete and
accurate data on adverse drug experiences associated with marketed
drugs, inspections conducted for the President's Emergency Plan for
AIDS Relief, and inspections of clinical trial sites.
[17] For information on additional efforts FDA undertakes as part of
its oversight of imported products, see GAO, Food and Drug
Administration: Overseas Offices Have Taken Steps to Help Ensure
Import Safety, but More Long-term Planning is Needed, GAO-10-960
(Washington, D.C.: Sept. 30, 2010).
[18] In 2005, we reported on how federal agencies, including FDA, are
addressing the illegal importation of prescription drugs. See GAO,
Prescription Drugs: Strategic Framework Would Promote Accountability
and Enhance Efforts to Enforce the Prohibitions on Personal
Importation, [hyperlink, http://www.gao.gov/products/GAO-05-372]
(Washington, D.C.: Sept. 8, 2005).
[19] An API includes any component that is intended to provide
pharmacological activity or other direct effect in the diagnosis,
cure, mitigation, treatment, or prevention of disease. See 21 C.F.R. §
210.3(b)(7) (2010). In this report, we refer both to drug products--
drugs in their finished dosage form--and to APIs as "drugs."
[20] See 21 U.S.C. §§ 360(h), (i)(3); 381(a).
[21] ORA investigators lead inspections. Investigators are responsible
for performing or overseeing all aspects of an inspection. ORA
laboratory analysts are chemists or microbiologists and have expertise
in laboratory testing. In some instances, staff from CDER may
participate in inspections.
[22] Approval of an abbreviated new drug application is necessary to
market a generic drug.
[23] While OTC drugs may reach the market through FDA's review of a
new drug or abbreviated new drug application, the majority of OTC
drugs are marketed through a different process. If a manufacturer
determines that an OTC drug is in compliance with an FDA regulatory
statement (called a monograph) that specifies such information as
acceptable ingredients, dosage, labeling, and mode of administration,
the drug may be marketed without FDA preapproval. Establishments that
manufacture OTC drugs that reached the market through the monograph
process may not receive a preapproval inspection.
[24] The number of preapproval inspections conducted by FDA in a given
year is dependent on the number of drug applications received. It is
also affected by the number of establishments included on each
application and the inspection history of the establishments.
[25] Although FDA considers nearly all drug establishment inspections
to include an assessment of GMPs, to differentiate them from product
specific, preapproval inspections, in this report we describe all
systemwide, postapproval inspections as "GMP inspections."
[26] Most combined inspections occur when FDA conducts a GMP
inspection at an establishment that was already selected to receive a
preapproval inspection. However, officials told us that if a combined
inspection was conducted at an establishment selected for inspection
through CDER's risk-based selection process, the preapproval
inspection was generally added after the establishment had already
been selected for a GMP surveillance inspection.
[27] Customs brokers are private individuals, partnerships,
associations, or corporations that are licensed, regulated, and
empowered by CBP to assist in meeting federal requirements governing
imports and exports.
[28] Such establishments may have gone out of business, but not
informed FDA, or the establishments may not actually ship drugs to the
United States. Some foreign establishments may register with FDA, but
never ship drugs to the United States. FDA officials told us that such
foreign establishments may register because, in foreign markets,
registration may erroneously convey an "approval" or endorsement by
FDA.
[29] FACTS provides information about establishments that have
previously been inspected, including: registered establishments;
establishments that are required to register, but have not done so;
and establishments that are not required to register. Foreign
establishments that manufacture APIs are not required to register with
FDA if their products are not directly imported into the United
States. For example, an establishment in China may export an API to
Germany. The German establishment may use the API in its production of
a drug that is imported into the United States. Although the German
establishment would be required to notify FDA of its arrangement with
the Chinese establishment, and the Chinese establishment would be
subject to inspection by FDA, the Chinese establishment would not be
required to register.
[30] CDER applies the same risk-based model to its inventory of
domestic establishments to prepare a prioritized list of domestic
establishments to be forwarded to ORA.
[31] We are using the number of foreign inspections conducted in a
fiscal year in our calculations, rather than the number of unique
foreign establishments inspected. Although FDA can inspect an
establishment more than once a year, during this time period there was
not a sizeable difference between the number of foreign inspections
conducted and the number of unique establishments inspected. For
example, in fiscal year 2009, FDA conducted 424 inspections at 416
unique establishments.
[32] FDA does not know the exact number of foreign drug establishments
that are subject to inspection. Instead of maintaining a list of such
establishments, FDA officials told us they annually draw on
information from multiple databases to compile an inventory of foreign
establishments to which FDA applies its risk-based model. We are using
the count of establishments in this inventory for our calculations
because it represents the best available data on the number of foreign
drug establishments subject to inspection.
[33] Members of the 2009 foreign drug cadre signed on for a 1-year
commitment, which ended in January 2010. Three members returned to
their original positions at the end of the year and were subsequently
replaced.
[34] For fiscal year 2009, one member of the foreign drug cadre
exclusively conducted inspections of clinical trial sites, which are
not within the scope of our review. We have therefore excluded these
inspections from the reported number of inspections conducted by cadre
members. It is also important to note that not all inspections in
fiscal year 2009 were conducted by a single cadre member; some
inspections were conducted by two members of the cadre at the same
time.
[35] According to FDA officials, one investigator in the China office
conducts drug inspections and one investigator primarily conducts
device inspections, but may conduct drug inspections as well. Two
investigators in the India Office are responsible for drug
inspections. In addition to these investigators, the China Office has
two investigators who focus on food inspections and the India Office
has one investigator who focuses on medical device inspections.
[36] In addition to conducting inspections, investigators in the
overseas offices have other responsibilities to aid in FDA's oversight
of imported products. These responsibilities include establishing
relationships with local governments, gathering information about
regulated products from local sources, and initiating investigations
to confirm registration information about local establishments.
Overseas office staff have periodically provided information regarding
foreign drug establishments to officials in FDA's headquarters.
However, as of August 2010, FDA had not yet established a formal or
systematic process for reviewing this information and incorporating it
into the process for selecting foreign drug establishments for
inspection. FDA officials told us that the agency is still developing
such a process and that it is also working to better utilize the
information it receives to improve its knowledge of foreign drug
establishments.
[37] FDA officials told us that the foreign drug cadre and other
domestically based staff from ORA will conduct the majority of foreign
inspections.
[38] The investigators assigned to the China and India offices
conducted an additional three drug manufacturing establishment
inspections in fiscal year 2009 that had not been entered into FACTS
by December 1, 2009, the date on which we received our data.
[39] This amount includes funding for the entire foreign drug
inspection program, including foreign drug inspections beyond the
scope of our review.
[40] The fiscal year 2008 supplemental appropriation provided $150
million to FDA in June 2008 and was available through the end of
fiscal year 2009. See Pub. L. No. 110-252, 122 Stat. 2323, 2345 (2008).
[41] For fiscal year 2009, FDA estimated that the average cost for ORA
to conduct a foreign inspection ranged from $60,000 to $62,500. This
is an increase from the estimated range of $41,000 to $44,000 we
previously reported for fiscal year 2007. The fiscal year 2009
estimate includes inflation of the average cost of an ORA full-time
equivalent (FTE) staff, inflation of travel and per diem costs, and a
higher average number of hours per inspection in fiscal year 2009 than
in fiscal year 2007. (One FTE represents 40 hours of work per week
conducted by a federal government employee over the course of a year.)
The fiscal year 2009 estimate also includes ORA's share of rent and
rent-related expenditures, which was not included in the previous
calculation for fiscal year 2007. There are additional costs, such as
costs associated with CDER's review of inspection reports, which are
not included in this estimate.
[42] We previously reported that comparing the average number of
foreign establishment inspections per year from fiscal years 2002
through 2007--247--to the 3,249 foreign establishments in FDA's
inventory in fiscal year 2007 suggests that the agency inspects about
8 percent of foreign establishments in a given year. We noted that at
the average rate of inspections conducted from fiscal years 2002 to
2007, it would take FDA more than 13 years to inspect this group of
establishments once, assuming that no additional establishments enter
the U.S. marketplace and no establishments go out of business. See GAO-
08-970, 23.
[43] It is important to note that FDA may inspect a unique
establishment more than once a year. Although we have determined that
another calculation can be done using the number of unique
establishments inspected, the result is the same. The 424 inspections
conducted in fiscal year 2009 were conducted at 416 unique
establishments. If FDA continued to inspect 416 unique establishments
each year, it would take FDA about 9 years to inspect each of the
3,765 establishments in FDA's inventory in fiscal year 2009. Both
calculations assume that no additional establishments enter the U.S.
marketplace and no establishments go out of business in the future. If
more foreign establishments are subject to inspection in subsequent
years, the length of time it would take FDA to inspect each
establishment once would also increase.
[44] This is a decrease from the 1,122 domestic inspections conducted
in fiscal year 2007 and the 1,033 inspections conducted in fiscal year
2008.
[45] FDA officials outlined legal authorities that they believe the
agency currently does not have which would be helpful in improving its
oversight of drugs manufactured in foreign establishments. For
example, these include authorizing FDA to: (1) suspend or cancel drug
establishment registrations to address concerns, including inaccurate
or out-of-date information; (2) require drug establishments to submit
a unique establishment identifier; and (3) implement a risk-based
inspection process, with flexibility to determine the frequency with
which both foreign and domestic establishments are inspected, in place
of the current requirement that FDA inspect domestic establishments
every 2 years. As of August 2010, FDA had not completed a formal
analysis to determine the appropriate inspection frequency for foreign
and domestic drug establishments. However, in response to our
inquiries and those of congressional staff, FDA has undertaken such a
review.
[46] FDA officials told us that this count could include
establishments that received an inspection other than a GMP inspection
prior to fiscal year 2000, but for which inspection data may not have
been transferred when the agency began using FACTS in 2000.
[47] According to FDA officials, domestic establishments that may
never have been inspected could be new establishments or those that
are not generally subject to GMP inspections.
[48] Registered establishments whose drugs are being imported, but
which have never been inspected, include OTC manufacturing
establishments. However, FDA has not conducted a formal analysis to
determine how many such establishments are in its inventory.
[49] Establishments that may not actually be subject to inspection
include those whose drugs were never imported into the United States
or those that have stopped shipping drugs into the United States
without notifying FDA. In addition, some establishments may have gone
out of business without informing FDA. Establishments that have never
shipped drugs to the United States or have not done so recently remain
in FDA's inventory. FDA cannot be certain that these establishments
will not ship products to the United States.
[50] According to FDA officials, the agency combines preapproval and
GMP inspections because foreign establishments are inspected
infrequently, and it increases efficiency to conduct preapproval
inspections and GMP inspections during the same visit to a foreign
establishment. When an establishment has already been selected to
receive a preapproval inspection, FDA may also conduct a GMP
inspection during the same visit. Although this is the case for most
combined inspections, officials told us that if a combined inspection
was conducted at an establishment selected for inspection through
CDER's risk-based selection process, the preapproval inspection was
generally added after the establishment had already been selected for
a GMP surveillance inspection. In fiscal year 2009, of the 312
combined preapproval and GMP inspections conducted by FDA, 61
inspections were conducted at establishments selected through the risk-
based process.
[51] We previously reported that for fiscal years 2002 through 2007,
about 13 percent of the foreign inspections FDA conducted were GMP-
only inspections, either surveillance or for-cause, compared to about
85 percent of domestic inspections during the same period. See GAO-08-
970, 27.
[52] FDA officials told us that since fiscal year 2008, therapeutic
biologic manufacturing establishments have been included in the
agency's annual prioritized list. Therefore, the number of
establishments inspected from the prioritized list in fiscal year 2007
is not directly comparable to the number inspected in fiscal years
2008 and 2009. However, FDA inspects relatively few foreign
therapeutic biologic manufacturing establishments per year.
Therapeutic biologics are produced using living organisms, such as
yeast, bacteria, or mammalian cells.
[53] During 2009, mandatory electronic registration was implemented
after some establishments had already submitted their registration
information on paper forms for the year. According to an FDA official,
establishments that updated their registration on paper prior to June
1, 2009, were considered registered for 2009 and were not asked by FDA
to update their registration again for this year. The information
contained in the agency's paper-based registration system--DRLS--will
still exist for archival purposes, but no new information will be
added to this system after December 31, 2010. If an establishment does
not register electronically, its information will not be in FDA's
registration database.
[54] Both foreign and domestic establishments are required to register
with FDA once each calendar year. FDA has instructed establishments to
complete their annual registrations between January and July. However,
according to agency officials, if an establishment has not registered
in accordance with the schedule FDA does not consider it to be out of
compliance until December 31. Therefore, eLIST may not be fully
populated until January 2011.
[55] FDA will continue to use DRLS to help select establishments for
inspection until eLIST is fully integrated with other FDA databases.
[56] The D-U-N-S® Number is a unique nine-digit sequence recognized as
the federal government's universal standard for identifying and
keeping track of business entities. Submitting the site-specific
number for an entity would provide, by reference to the number,
certain business information for that entity that is otherwise
required for drug establishment registration. For example, a D-U-N-S®
Number could be used to identify trade names used by the entity;
addresses; additional ownership information, such as the name of each
partner or the name of each corporate officer and director; and the
state of incorporation.
[57] FDA performs this verification by comparing the country code in
the establishment's registration file to the country code associated
with the D-U-N-S® Number in Dun and Bradstreet's Global Business
Database, which contains information that the company collects on
foreign businesses. According to Dun and Bradstreet officials, this
database contains approximately 170 million records from businesses
located in more than 200 countries and provides Dun and Bradstreet
with information on data elements, such as business names, addresses,
and phone numbers.
[58] According to FDA officials, once the algorithm is implemented,
establishment registration information submitted to FDA will be
verified before being recorded in eLIST. The agency also plans to use
the algorithm to verify existing electronic registration data
collected prior to implementation of the algorithm. If errors are
found in existing registration data, FDA plans to request that
establishments submit corrected information.
[59] We previously reported that in fiscal year 2007, about 3,000
foreign drug establishments were registered with FDA. See GAO-08-970,
17.
[60] In September 2008 we reported that, on the basis of the
information contained in OASIS, 6,760 foreign establishments
manufactured drugs that were offered for import into the United States
in fiscal year 2007. See [hyperlink,
http://www.gao.gov/products/GAO-08-970], 20.
[61] The algorithm currently used by customs brokers to assign the
manufacturer identification number does not provide for a number that
is reliably reproduced or inherently unique. Consequently, according
to FDA officials, multiple records may be created for a single
establishment, resulting in an inflated count of the number of
establishments.
[62] Establishments that have not shipped a product to the United
States in the previous 3 years are not scheduled for inspection.
[63] FDA previously referred to this program as the Foreign Vendor
Registration Verification Program (see GAO-08-970, 19).
[64] To select establishments for the Foreign Registration
Verification Program, FDA uses information from OASIS to determine the
products that establishments are shipping to the United States and to
identify establishments that are importing a variety of products.
[65] According to FDA officials, the Foreign Registration Verification
Program covers establishments manufacturing all FDA-regulated
products. In addition to the 43 drug establishments, FDA's contractors
visited 130 foreign food manufacturing establishments located in North
America, South America, Asia, Europe, Australia, Africa, and the
Middle East.
[66] According to agency officials, as of July 2010, FDA had not yet
determined the type of action to take against the other five
establishments that appeared not to exist.
[End of section]
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